According to the National Association of Realtors, existing-home sales in the fourth quarter of 2017 increased from 2016, leading to an all-time low housing inventory, which leads to a robust increase in home prices.
For builders, this is a sign that buyer interest is equating to home sales, which is a good indicator to continue building. The combination of less homes being available and the national family median income rising ($74,492 in the fourth quarter of 2017) means the demand for more homes should follow.
“A majority of the country saw an upswing in buyer interest at the end of last year, which ultimately ended up putting even more strain on inventory levels and prices,” said NAR chief economist Lawrence Yun.
1.48 million existing homes were available for sale at the end of 2017. This was 10.3% less than the end of 2016, when there were 1.65 million existing homes for sale.
“These consistent, multi-year price gains have certainly been great news for homeowners, and especially for those who were at one time in a negative equity situation; however, the shortage of new homes being built over the past decade is really burdening local markets and making home buying less affordable,” added Yun.
The quarterly reports from the National Association of Realtors over the first half of 2018 will provide more clarity on the overall construction and real estate markets, but the statistics released this week point to a strong start.
This report seems to indicate a positive economic forecast for general contractors in the new home construction segment. The team at Builders’ General is here help you with materials and assistance for your projects. Contact us at 1-800-570-7227 or visit one of our five New Jersey building locations.